Sources: Autoblog, Wisconsin Ag Connection
quote: This is that little "nudge" Obama and co believe you need to choose what they've determined to be the right car. Look what cash for clunkers did, it proved supply and demand economics. The supply of used cars fell dramatically, along with the spare parts they contained were all destroyed. Fewer cars higher prices.
quote: Which then forced car companies to create more cars to fill the gap in supply (in order to maximize total profit), creating several hundred thousand jobs in the process (both direct and indirect).As such, the fix is obvious: Start tearing down vacant houses to reduce supply, then sell the left over material back to home builders and other industry for a tidy profit.
quote: economics will ALWAYS favor those who have amassed wealth. You have to scrutinize the means with which they ammassed said wealth to decide whether it was appropriate or 'fair' depending on how you wish to define that, but simply saying a scenario favors someone with more wealth than those without is simply stating something obvious that could apply to 99.9% of reality. It's like a car with more HP is going to make it up a hill faster and work less to do so.
quote: I already own a house. If my house is worth $300k and I sell it tomorrow and get $300k for it, I can buy a similar house for a similar price. If we tore down a bunch of old houses to reduce supply and it raised the value of my house to $600k, it doesn't really hurt me since I can sell my house for $600k and then buy a similar house for $600k.However it hurts those who are looking to buy their first house. If they're having trouble securing a loan to buy a $300k house, how in the world will they afford a $600k house?
quote: People are being brainwashed into thinking that owning a home is such a great investment that they should risk their entire financial future trying to get one.
quote: If a family cant afford a $300k then maybe they should look at $200k homes, hell you can get a pretty decent house for around $150k in my area. And if after all that they still cant get a house then... just wait longer?
quote: I already own a house. If my house is worth $300k and I sell it tomorrow and get $300k for it, I can buy a similar house for a similar price. If we tore down a bunch of old houses to reduce supply and it raised the value of my house to $600k, it doesn't really hurt me since I can sell my house for $600k and then buy a similar house for $600k.
quote: However it hurts those who are looking to buy their first house. If they're having trouble securing a loan to buy a $300k house, how in the world will they afford a $600k house?
quote: By the same reasoning, I can create jobs and improve my local economy by littering. Since someone needs to clean up the mess, I can create jobs by dumping my trash on the ground. If I dump enough trash on the ground, everyone in my town can be employed picking up my garbage.
quote: The same thing goes for Cash for Clunkers- people that couldn't afford a new car but could afford a cheaper used car were suddenly priced out of that market, too, since the price of used cars went up.
quote: Heres where you analogy falls apart: A ~$500k house in NY equates to about ~$250k in Florida, due to cost of living adjustments. So you sell your house in NY for ~$500k, purchase a ~$250k house in Florida, and boom, sunny beaches, no income tax, and +$250k in your bank account.
quote: That's free market economics in a nutshell. Demand goes up, supply decreases, price spikes, business hires, production increases, demand settles down, new equilebrium reached, with a slightly higher employment rate. Rinse and repeat as needed.
quote: It really is like a sub-par engineer trying to create a perpetual motion machine. In a futile effort to override the fundamentals of physics, the engineer makes the system more and more complicated until it confuses him into thinking it will work.
quote: It's time to realize that a free market doesn't work without proper regulation.